'Flexi-cap funds are for life, add on corrections'

Balanced advantage funds or equity savings manage asset allocation dynamically and are suitable for investors seeking smoother participation without making timing calls.

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Kalpen Parekh, MD & CEO, DSP Mutual Fund, tells Saikat Neogi that conservative investors should start with large-cap funds and add to flexi-cap funds on corrections.

What investment strategy would you suggest for retail investors now?

All segments of the market have some opportunities as well as risks. Personally, I prefer a flexi-cap fund for life which will choose a good mix of good companies and good valuations and across companies in India and the world. This approach allows freedom to do what is right without being slotted in one category and there is better tax efficiency when the fund rebalances exposures, while the investor remains invested forever. If you are a very conservative investor, you could start with large-cap funds and add to flexi-cap funds on corrections.

For retail investors willing to invest lumpsum, would hybrid strategies be a better bet now?